The Power of Perspectives

Litigation funding: CETA’s disclosure requirements

There is still resistance in some jurisdictions, such as Ireland, to third-party litigation finance. But the market, globally, continues to make headway, particularly as Hong Kong has now allowed the practice in arbitration and mediation matters.

What sets Hong Kong apart from other jurisdictions, though, is that it has imposed requirements on funded parties to disclose the funding arrangement, as well as the identity of the third-party funder, all with a view to addressing concerns about conflicts of interest between the various parties involved.

In the arbitration context there is currently no explicit requirement for litigants to disclose their funding arrangements in Canada (though in Ontario a court may force the disclosure of such an arrangement to the opposing party in the class action context).

Having said that, funded parties involved in multi-jurisdictional disputes would be well advised to consider the provisions of the Canada-European Union Comprehensive

Because CETA’s investor court provisions will not come into force into approved by legislatures of all EU member states, it will be some time before the disclosure requirements come into force. Even so, for better or for worse, it marks a step in the evolution and acceptance of the practice in the Canadian setting.

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